Q1 FY26 Revenues Rise to $225.2M, Adjusted EPS Climb to $1.07
Q1 FY26 revenues rose to $225.2M from $214.8M, with non-GAAP adjusted EPS of $1.07 versus $1.03 and GAAP EPS of $0.57. Applebee’s comps increased 1.9% (23.9% off-premise), IHOP comps were flat (21.5% off-premise), adjusted EBITDA declined to $50.8M and free cash flow was -$3.0M.
1. Q1 Financial Results
Total revenues for Q1 FY26 reached $225.2 million, up from $214.8 million year-over-year, driven by increased company-owned restaurant sales. GAAP net income was $7.2 million for EPS of $0.57, while non-GAAP adjusted net income rose to $13.5 million for EPS of $1.07; adjusted EBITDA totaled $50.8 million.
2. Same-Restaurant Sales Trends
Applebee’s domestic comparable same-restaurant sales increased 1.9%, with off-premise sales representing 23.9% of mix, while IHOP delivered flat comparable sales with a 21.5% off-premise mix. The company attributes same-restaurant sales gains to everyday value initiatives, targeted marketing, and disciplined execution.
3. Cash Flow and Capital Returns
Operating cash flow was $7.5 million compared to $16.1 million a year earlier, leading to adjusted free cash flow of negative $3.0 million versus $14.6 million previously, largely due to performance plan compensation payments. The company repurchased $22 million of common stock and paid $2.5 million in dividends during the quarter.
4. Restaurant Development and Strategic Outlook
Development activity resulted in 24 new restaurant openings and 40 closures, with the company on track for approximately 80 dual-brand locations domestically by year-end. Cash and equivalents stood at $172.9 million, available borrowing capacity at $225 million, and guidance for fiscal 2026 was reaffirmed, targeting consolidated adjusted EBITDA of $220-230 million.